The Future Won't Look Like the Past

Change is inevitable, but what will it look like?

It took a while, but the new suburbs have it figured out (or so they think). People do not want to live near schools, churches, stores, busy roads, hotels, restaurants, or anything except for other houses like theirs. So we zone residential neighborhoods as isolated single use pods with a fairly narrow range of housing sizes. City councils and zoning boards believe that if enough lower income households move in to the school district or city, housing values might start to fall and the viscious cycle of decline will begin. As a result, multifamily housing is carefully segregated from the rest and its existance is limited.

Because real incomes are up over the last 60 years and lifestyles have changed (I have heard that most formal dining rooms in the US now function as home offices), houses in the outter ring are larger and more adapted to 21st century middle and upper middle class households.

Can the inner ring compete with that? Probably not. Instead of developing large tracts of previously agricultural land and taking advantage of economies of scale to produce housing the 21st century family wants at $80/SF, replacing inner-ring houses costs over $100/SF PLUS the cost of the land. And when you replace older housing, the income variance becomes much larger than what you see in the new suburbs. Beyond that, although zoned, the inner ring has a much wider variety of housing types in much less isolated neighborhoods than the new suburbs. This means that inner ring schools will always have a much more diverse (at least economically) student body than the new suburbs.

In short, for households that dream of a large 21st century house in a cul-du-sac with a homogeneous neighborhood and local school, the inner ring, is just not an attractive option for a lot of households.